CPI commentary – March 2026
Annual consumer inflation accelerated sharply to 4.0% in April, from 3.1% in March, marking the largest monthly jump in the headline rate in over a year.
Prices rose 1.1% month-on-month, the strongest monthly print since early 2024. The outcome was driven almost entirely by the long-anticipated transmission of the oil shock into pump prices, with the broader basket remaining relatively well behaved.
The composition tells a clear story of an external shock dominating an otherwise contained domestic backdrop. Transport contributed 0.7 of a percentage point to annual inflation, a swing of close to a full percentage point from March. Fuel inflation rose to 11.4% y/y, with prices up 18.2% month-on-month alone. This is the mirror image of the disinflationary tailwind that flattered prints through late 2025 and early 2026.
Beyond fuel, the picture is more nuanced. Food eased to 2.9% y/y, with meaningful disinflation in cereal products and fruit and vegetables, while meat inflation remains the conspicuous outlier. Services inflation edged higher to 4.6% from 4.2%, with stickiness concentrated in administered categories. Administered prices are still running well above headline inflation, reflecting structural rather than cyclical pressures.
From a policy perspective, the print complicates the SARB's near-term decision making but does not derail the broader disinflation narrative. The Bank has consistently emphasised it will look through first-round effects of supply-side shocks. With the repo rate at 6.75% and real rates firmly positive, the SARB retains some optionality, but the bar for further easing has risen.
For investors, the April print signals headline reacceleration is a fuel story that should peak and roll off as base effects normalise, provided oil stabilises. A key risk worth monitoring is rand stability, where should the currency weaken materially from here, then the SARB's patient bias could become harder to maintain. For now, we view April as a shock-driven spike rather than a regime change.
